Europe cannot achieve climate neutrality by undermining the industries needed to deliver it.
Europe has spent the past two years reviving a word that had almost disappeared from its political vocabulary: competitiveness. From Mario Draghi's warning that Europe risks a gradual economic decline to the European Commission's renewed focus on industrial strength, a broad consensus emerged. Europe cannot achieve its climate objectives, maintain its prosperity or strengthen its strategic autonomy without a competitive industrial base.
Yet one critical sector is not adequately listened to in this debate: refining and fuel manufacturing.
For too long, the debate on Europe's refining and fuel manufacturing industry has been overly polarised while the industry portrayed as part of the problem rather than as part of the solution. This is a profound mistake.
The reality is that Europe's refining and fuel manufacturing industry remains indispensable to the functioning of the economy. It fuels aviation, maritime transport, defence, emergency services and industrial production. It supplies critical feedstocks to chemical manufacturing, construction and agriculture. Around half of the European chemical industry's feedstock originates from refinery outputs. Far from being a relic of the past, the sector remains deeply embedded in Europe's industrial value chains.
More importantly, it will remain central to Europe's future.
Despite significant progress in electrification, liquid fuels will continue to play an essential role in sectors where alternatives remain limited. Aviation, shipping, heavy road transport and petrochemicals will continue to depend on energy-dense liquid fuels for decades. This is not a matter of preference or ideology. It is a matter of technological and physical reality.
The key difference on our way to climate neutrality is that the liquid fuels needed, today and in the future, will gradually shift from a crude-based to a renewable-based origin.
The question is therefore not whether Europe will continue to need fuels. It will.
The real question is whether Europe intends to produce them.
In this context, the transformation of existing refineries will be crucial to Europe’s energy future and strategic autonomy.
Today, policymakers often speak as though climate ambition and industrial competitiveness are separate objectives. They are not. Competitiveness is the foundation upon which successful decarbonisation must be built.
A refinery that closes does not automatically reduce global emissions. More often, production simply moves elsewhere. Europe imports more. Strategic dependencies deepen. Industrial jobs disappear. And the infrastructure capable of producing future renewable and low-carbon fuels is permanently lost. Since 2009, Europe has already lost 35 refineries and around 20% of its refining capacity. Once these sites close, they are rarely replaced. Once lost, these industrial capabilities are extremely difficult and costly to rebuild.
This should concern anyone serious about the energy transition.
Europe's refining and fuel manufacturing industry is not standing still. Across the continent, companies are investing in renewable fuels, sustainable aviation fuels, renewable diesel, hydrogen and other low-carbon technologies. Existing refineries are being transformed into integrated energy hubs capable of supporting Europe's decarbonisation objectives. The industry's commitment is evident. What remains uncertain is whether Europe will create the conditions necessary for that transformation to continue.
Yet transformation requires investment, and investment will only happen if companies have confidence in Europe's long-term policy and regulatory framework.
Today, that confidence is increasingly under pressure. European energy costs remain structurally higher than those of key competitors. Carbon costs continue to rise. Regulatory requirements accumulate, often with limited coordination and increasing complexity. Investors making decisions involving billions of euros need stability and predictability. Too often, they see neither.
This matters because Europe's transition ambitions cannot be delivered through wishful thinking. The scale of investment required is enormous. Achieving climate objectives will require converting existing industrial assets while simultaneously developing new low-carbon production capacity. That effort will only succeed if investment remains in Europe rather than flowing elsewhere.
This is why refinery conversion must become a strategic priority.
Repurposing existing assets is faster, cheaper and more realistic than attempting to replace them with entirely new infrastructure. Existing refinery sites already possess the logistics networks, industrial integration, skilled workforces and physical infrastructure required to scale low-carbon fuel production. Studies indicate that converting existing facilities can reduce capital requirements by 30 to 50% compared with new greenfield developments. Europe simply cannot afford to ignore such an advantage and take on such an additional cost.
Europe's leaders increasingly speak about resilience, strategic autonomy and industrial sovereignty. Those objectives are welcome. But they cannot be achieved through speeches alone. They require policies that recognise industrial reality.
The transition will not succeed if Europe weakens the industries capable of delivering it. It will not succeed if investment continues to migrate to more attractive jurisdictions. And it will not succeed if industrial competitiveness is treated as an afterthought.
The stakes go beyond the future of a single sector.
Europe's refining and fuel manufacturing industry supplies products that remain essential to mobility, defence, manufacturing and economic activity. It also provides the industrial platform on which much of the fuel transition will depend. Weakening that platform before viable alternatives are scaled up would not accelerate decarbonisation. It would make it harder, more expensive and more dependent on imports.
The harsh reality is that Europe cannot decarbonise through deindustrialisation.
A successful transition requires industries that can invest, innovate and compete. It requires confidence. It requires competitiveness.
The lesson from Europe's competitiveness debate is clear: industrial strength and decarbonisation are not competing objectives. They are mutually reinforcing.
Because in the end, the equation is remarkably simple:
No competitiveness. No transition.
Promoted by FuelsEurope
